Krugman's Economics For The Ap® Course
Krugman's Economics For The Ap® Course
3rd Edition
ISBN: 9781319113278
Author: David Anderson, Margaret Ray
Publisher: Worth Publishers
Question
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Chapter 9R, Problem 1MCQ
To determine

The effect and consumer buying when the price of normal good falls.

Expert Solution & Answer
Check Mark

Explanation of Solution

When the price of a normal good decreases, consumers will increase the quantity which they want to purchase because it increases the ability of consumers to buy more. This is the income effect because it increases consumers’ purchasing power.

Therefore, the correct option is e.

Economics Concept Introduction

Introduction:

A normal good is a general good that consumers want to buy more when their income increases such as food, clothing, etc.

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